MORGANTOWN – The “frenemy” status of the coal and natural gas industries was evident in Wednesday’s debate of a Senate bill designed to promote natural gas power generation projects in the state.
SB 188 is the Grid Stabilization and Security Act, deliberated at length by the Senate Economic Development Committee.
It opens with a series of legislative findings – statements of legislative sentiment that summarize the reason for the bill – that were the bill’s chief stumbling block for coal industry representatives.
The findings say gas-fired power is highly underdeveloped in comparison to nearby states that West Virginia competes with for economically beneficial projects. “Natural gas electric generation projects have been undermined by existing regulatory requirements and related time delays.”
Therefore, state agencies should attempt to promote coordination, simplification, and harmonization, the findings say.
Getting to the meat of the legislation, the bill says the Department of Economic Development will identify economically viable sites for gas-fired power projects – near gas wells or pipelines, transmission infrastructure and areas that fulfill state air quality requirements.
Economic Development will inform the Department of Environmental Protection and the Public Service Commission about its choice of sites.
The bill then requires expedited permitting to get the projects rolling.
Sen. Mike Stuart, R-Kanawha, opened the debate, asking why the bill never mentions coal. “West Virginia is under assault; the entire fossil fuel industry is under assault.”
That brought Chris Hamilton, West Virginia Coal Association president, to the lectern to outline his concerns.
He softened his comments several times, saying coal has always worked closely with its oil and gas colleagues. “We have a long history of working together.”
But some gas executives, he said, have publicly said they want to displace coal. And lawyers could deliberately misapply and exaggerate the bill’s findings in court to undermine the coal industry in disputes where natural gas wishes to declare itself as the dominant estate.
He has no intentions of killing the bill, he said. “We embrace and support full development of our natural resources. … We support this bill going forward.”
What he wants, he said, is to tone down or remove the findings.
Nationally, natural gas makes up 42% of the electric power supply, coal less than 20%, he said. About 70% of recent power outages were tied to natural gas supply failures. So coal just wants a level playing field. “We don’t think we should be trading one energy job for another.”
Phil Reale, representing GO-WV, the gas and oil association, also aimed to be cordial. “I don’t view this as a dispute between natural gas and coal.” The bill is intended to promote use of West Virginia resources, he said. New coal plants are not likely across the entire country, and there is much interest in gas-fired power plants and their lower electricity costs.
Reale pointed out that natural gas accounts for on only 4% of power generation in West Virginia. Ohio has 13 gas-fired plants, Pennsylvania has 26, West Virginia has zero.
Doing away with the mounds of red tape here, he said, could open the door for economic development and help get West Virginia gas to markets where it’s needed.
Curtis Wilkerson was called to the lectern to talk about three gas-fired projects he worked with – in Harrison, Brooke and Marshall counties. Red tape and lawsuits killed them, along with $2.2 billion of investment for construction alone.
Wilkerson said independent power project investors don’t care where they build – all the power feeds into PJM’s 13-state grid. If the plants aren’t built here they will be built somewhere else.
He worries West Virginia is not sending welcoming signals to potential investors, he said. This bill says the state welcomes “all of the above.”
Senators discussed striking the findings but never actually proposed it. An alternate amendment, to insert the word coal alongside every reference to natural gas, was voted down.
Sen. Eric Tarr, R-Putnam, said he took issue that the bill is adverse to coal. There is no anti-coal intent in it. “The more we can bring the cost of power down, the more competitive we are as a state.”
Several senators noted that coal already enjoys some of the expedited timelines spelled out for gas in the bill. And Stuart referenced the red tape. “We need to speed this up for every industry.”
The bill passed in a voice vote, with Sen. Laura Chapman, R-Ohio, voicing the only vote against. It now heads to the full Senate.
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